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Debts - Components of Notes Payable and Capital Leases (Details) - USD ($)
Jun. 30, 2015
Jun. 30, 2014
Total $ 3,549,973 $ 6,308,504
Current Maturities (3,425,161) 5,311,367
Long-Term Maturities 124,812 997,137
Subsidiary Capital Leases, Current Maturities (471,192)  
Subsidiary Capital Leases, Long-Term Maturities 362,680  
Total 4,383,845 7,323,338
Current Maturities 3,896,353 5,791,258
Long-Term Maturities 487,492 1,532,080
D & O Insurance [Member]    
Total [1] 79,872 54,547
Current Maturities [1] $ 79,872 $ 54,547
Long-Term Maturities [1]    
Habib Bank Line of Credit [Member]    
Total [2]   $ 2,438,844
Current Maturities [2]   $ 2,438,844
Long-Term Maturities [2]    
Bank Overdraft Facility [Member]    
Total [3]    
Current Maturities [3]    
Long-Term Maturities [3]    
HSBC Loan [Member]    
Total [4] $ 447,161 $ 835,899
Current Maturities [4] 322,349 346,138
Long-Term Maturities [4] $ 124,812 489,761
Term Finance Facility [Member]    
Total [5]   632,527
Current Maturities [5]   253,011
Long-Term Maturities [5]   379,516
Loan Payable Bank [Member]    
Total [6] $ 2,892,961 2,024,087
Current Maturities [6] $ 2,892,961 $ 2,024,087
Long-Term Maturities [6]    
Loan From Related Party [Member]    
Total [7] $ 129,979 $ 322,600
Current Maturities [7] $ 129,979 194,740
Long-Term Maturities [7]   127,860
Subsidiary Capital Leases [Member]    
Subsidiary Capital Leases, Total [8] $ 833,872 1,014,834
Subsidiary Capital Leases, Current Maturities [8] 471,192 479,891
Subsidiary Capital Leases, Long-Term Maturities [8] $ 362,680 $ 534,943
[1] The Company finances Directors' and Officers' ("D&O") liability insurance as well as Errors and Omissions ("E&O") liability insurance, for which the total balances are renewed on an annual basis and as such are recorded in current maturities. The interest rate on the insurance financing was 0.49% and 0.55% as of June 30, 2015 and 2014, respectively.
[2] In April 2008, the Company entered into an agreement with Habib American Bank to secure a line of credit to be collateralized by certificates of deposit held at the bank. The interest rate on this line of credit is variable and was 1.5% as of June 30, 2015 and 2014, respectively. In June 2012, the Company's subsidiary, NTA, entered into an agreement with Habib American Bank to secure a line of credit up to $500,000 to be collateralized by certificates of deposit of the same value held at the bank. The interest rate on this line of credit is variable and was 1.9% as of June 30, 2015 and 2014, respectively. Combined interest expense for the years ended June 30, 2015 and 2014 was $8,658 and $35,764, respectively.
[3] During the year ended June 30, 2008, the Company's subsidiary, NTE entered into an overdraft facility with HSBC Bank plc whereby the bank would cover any overdrafts up to £300,000, or approximately $471,550. The annual interest rate was 4.75% as of June 30, 2015 and 2014, respectively. This overdraft facility requires that the aggregate amount of invoiced trade debtors (net of provisions for bad and doubtful debts and excluding intra-group debtors) of NTE, not exceeding 90 days old, will not be less than an amount equal to 200% of the facility. As of June 30, 2015, NTE was in compliance with this covenant.
[4] In October 2011, the Company's subsidiary, NTE, entered into a loan agreement with HSBC Bank to finance the acquisition of 51% of a controlling interest in Virtual Leasing Services Limited. HSBC Bank guaranteed the loan up to a limit of £1,000,000, or approximately $1,571,833 for a period of 5 years with monthly payments of £18,420, or approximately $28,953. The interest rate was 4% which is 3.5% above the bank sterling base rate. The loan is securitized against debenture comprising of fixed and floating charges over all the assets and undertakings of NTE including all present and future freehold and leasehold property, book and other debts, chattels, goodwill and uncalled capital, both present and future. Interest expense for the years ended June 30, 2015 and 2014 was $47,255 and $70,667, respectively. This facility requires that NTE's adjusted tangible net worth would not be less than £600,000. For this purpose, adjusted tangible net worth means shareholders' funds less intangible assets plus non-redeemable preference shares. In addition, NTE's cash debt service coverage would not fall below 150% of the aggregate debt service cost. As of June 30, 2015, NTE was in compliance with this covenant.
[5] The Company's subsidiary, NetSol PK, entered into two different term finance facilities from Askari Bank to finance the construction of a new building. The total aggregate amount of these facilities is Rs. 112,500,000, or approximately $1,084,860 (secured by the first charge of Rs. 580 million or approximately $5.59 million over the land, building and equipment of NetSol PK). The interest rate was 9.79% and 12.39% as of June 30, 2015 and 2014, respectively, which is 2.75% above the six-month Karachi Inter Bank Offering Rate. During the year ended June 30, 2015, NetSol PK paid off the complete liability against this financing.
[6] The Company's subsidiary, NetSol PK, has an export refinance facility with Askari Bank Limited, secured by NetSol PK's assets. This is a revolving loan that matures every six months. Total facility amount is Rs. 300,000,000 or $2,892,961. The interest rate for the loans was 7.5% and 9.4% at June 30, 2015 and 2014, respectively. Interest expense for the year ended June 30, 2015 and 2014 was $146,264 and $169,795, respectively. Both term and export refinance facilities from Askari Bank Limited amounting to Rupees 300 million ($2.89 million) require NetSol PK to maintain a long term debt equity ratio of 60:40 and the current ratio of 1:1. As of June 30, 2015, NetSol PK was in compliance with this covenant.
[7] In October 2013, the Company's subsidiary, NTE, entered into a loan agreement with Investec, a related party, to finance VLS. The loan amount was £100,000, or approximately $157,183, for a period of 1 year with monthly payments of £8,676, or approximately $13,637. The interest rate was 4.1%. As of June 30, 2015, NTE has paid the loan in full. In March 2014, the Company's subsidiary, VLS, entered into a loan agreement with Investec. The loan amount was £150,000, or approximately $235,775, for a period of two years with annual payments of £75,000, or approximately $117,887. The interest rate was 3.13%. As of June 30, 2015, VLS has used this facility up to $129,979 including interest due, and was shown as a current maturity.
[8] The Company leases various fixed assets under capital lease arrangements expiring in various years through 2018. The assets and liabilities under capital leases are recorded at the lower of the present value of the minimum lease payments or the fair value of the asset. The assets are depreciated over the lesser of their related lease terms or their estimated useful lives and are secured by the assets themselves. Depreciation of assets under capital leases is included in depreciation expense for the years ended June 30, 2015 and 2014.